I’m always interested in learning what my readers want to see next so I asked you this past week for suggestions. I received a handful of great recommendations and the one that I’m going to be addressing today was provided by Jon Bozzuto, a good friend currently living in the greater New York City area working as an Analyst at Morrow & Co.
Jon posed the question, “why take a risk when you are comfortable?” More specifically, he followed up and asked, “why would anyone take a risk to start something of their own when they have a nice, cushy salaried job with good benefits and security?”
I found this question to be particularly intriguing because it must be one that many people ask themselves at some point in their professional career. As an entrepreneur, there are many reasons that quickly race to my mind because of my familiarity with the “risky” situation.
In this post, I’ll share 5 core reasons why you may justify taking a risk to start something of your own and hone in on 2 factors that play a major role in your eventual decision.
5 Reasons to Risk Building a Business
Core Reason #1: Mental Growth and Personal Discovery
By taking a risk to start something on your own, you are diving into a world of unknowns where you will be ultimately challenged to perform in a capacity never presented before. Practices and tactics that you thought would work may not deliver forcing you to constantly adjust.
When experiencing such uncomfortable situations – whether by yourself or with a cofounder – you will find yourself thinking more deeply about your life, your business idea, and those around you. I
I am a strong supporter of placing yourself in the most uncertain of scenarios to facilitate personal growth and understanding. Granted there will be times when you want to throw in the towel, sticking through it will teach you more about your true ambition and purpose for living.
Taking a risk on becoming a business owner is one of those uncomfortable situations that can change your paradigm on people, work, and yourself. That is a knowledge that will allow you to achieve anything in your personal and professional life.
Core Reason # 2: Freedom from a “Boss”
If you decide to start something of your own, you gain a new freedom from any direct superiors that you would traditionally have in a job environment. You create your own schedule, you set your own salary (when the time comes), and the growth of the business depends solely upon you.
Instead of being told what to do, you strategize your own tasks most important to the growth of the company and you take action. Once your actions have been implemented, you are rewarded by seeing immediate, direct results on how your business has become more valuable.
The more that you put into the business, the more that you get out. Working 12 hour days doesn’t feel like a drag anymore because you are doing it of your own will and ambition.
Taking the initial risk on having to figure out how to manage your own time can quickly pay off once you get into a rhythm and can see the direct impact you are making on the growth of your new business.
Core Reason #3: Build Something you are Passionate About
When you decide to start their own business, it is usually based off of a problem that you recognized in your field of expertise that you are extremely passionate about solving. Every day, you encounter this particular problem and you think to yourself, “why isn’t there a solution to this yet?”
If that type of reasoning is the baseline for the start of your business, you are going to have an extreme amount of passion towards your life on a daily basis.
When you are wake up, you are going to be looking forward to working because you are solving a problem attached to your psyche. When you’re out with friends for drinks, you are going to be secretly thinking about it. And as you are falling asleep, it’s going to be burning in the back of your mind.
There is nothing like building a business that you are passionate about. Slowly, you become entranced by the idea of providing an ultimate solution to the initial problem that you identified and your life becomes a whirlwind of passion driven activities and experiences.
Core Reason #4: Acquire a Skill Set that Cannot be Taught
Cushy, salaried jobs can teach you an unlimited amount of valuable skills for the workforce, but they cannot teach you to be a business owner. Receiving a business degree or an MBA can provide you with the right knowledge to start a business, but nothing teaches you better than the actual experience.
Once you’ve taken the risk and lived life as an entrepreneur and business owner, you will acquire a skill set that is wanted by every company in the world. You gain a holistic view of how a business functions – the financials, the team structure, the systems & processes, the product & service, the addressable market. The list goes on for pages.
With your new skill set, you have a greater confidence in your abilities and a keen understanding of how to creatively problem solve to facilitate growth. Take that skill to any employer and they would be foolish not to hire you.
Core Reason #5: The Prospect of Financial Freedom
While you may be sacrificing the salary, health benefits, and security in the short term, building and owning a valuable business presents the opportunity of much greater financial return in the long run.
As an entrepreneur, you will be working towards goals that add more and more value to your business so that one day you will have an amazing salary and set of benefits that trump what you would have been able to achieve at a large corporation.
But that’s not all. At the end of the day, your end goal as a business owner should be to reach a liquidity event where financial freedom becomes a reality. I have received advice from a number of mentors that the only one true way to achieve ultimate financial freedom is to build and sell a valuable company.
Without taking the short term risk, you would never have that opportunity. Fully understanding the potential payout of your years of hard work building a business in comparison to the cushy, salaried job will help you to better understand why assuming short term risk today may be worth it for your life in the long run.
Keep in Mind: Timing and Strategy is Everything
Being a business owner and taking that initial risk isn’t for everyone and you must consider the timing and your strategy before diving into the unknown world of starting your own company.
Timing plays a major role because not everyone is in a situation where they can take the short term risk of sacrificed pay and security. Some have a family, a mortgage, and other piles of bills to support. For this genre of people, risking it all to start your own business may have to wait for better timing.
For those in a situation where your bills are more under control and you can sacrifice slight lifestyle changes in the short term, the timing may be just right.
Finally, reflect on the different strategies that you can take to begin your own business.
There is the obvious choice of jumping ship at your cushy, salaried job, but that might not be the smartest option even for the individual who has a control on their bills and the ability to assume short term risk.
The second, more realistic, option is to begin building your business while you are still working at a full time job. Schedule time in the evenings and on the weekends to make progress on your ideas.
Over time, you may gain your first set of customers and become ever closer to being able to leave your job to pursue the growth of your business full time. It will be difficult at first, but being a business owner is exactly that.
Closing Words from Nelson Mandela
As one of my favorite inspirational leaders once said, “it always seems impossible…until it’s done.” Use his words as inspiration to determine if taking the short term risk is worth the 5 core reasons that I outlined in this column.